ONE BIG THINGNvidia’s massive future spending commitments make its risk profile more complex, Saxo says
Charu Chanana, the chief investment strategist at Saxo, isn’t saying that Nvidia is funding a circular bubble in AI. But she isn’t totally dismissing it either, she said in a recent email to Fortune.
Nvidia’s Q2 earnings on Wednesday were stunning, lifting the entire market on Thursday. Nvidia’s stock was up 8.74% yesterday. But Chanana says the 10-Q also discloses a ton of future commitments and financing while also revealing a reduction in free cash flow, from $48.5 billion last quarter to $21.3 billion this time.
Look at the future commitments Nvidia is pumping into the AI buildout, per page 18 of its 10-Q:
Supply and capacity commitments: $279 billion (up from $119 billion last quarter)
